Proposition 98 Rainy Day Fund
The Budget reflects a revised 2024-25 mandatory payment of approximately $1.2 billion, and a 2025-26 mandatory payment of $376 million into the Public School System Stabilization Account (PSSSA). A mandatory withdrawal of roughly $8.4 billion in 2023-24 remains in place. With a $1.2 billion balance in 2024-25, school district reserve caps are not triggered in 2025-26.
Local Control Funding Formula (LCFF)
The Budget includes an LCFF cost of living adjustment (COLA) of 2.43%. This COLA and population growth adjustments will provide LEAs with $2.5 billion in discretionary funds.
Deferrals of $246.6 million are fully repaid in 2025-26 but the Budget proposes a reappropriation and reversion of $25.9 million to support ongoing LCFF costs in 2023-24. It also proposes a $35.1 million deferral from 2023-24 to 2024-25, which is fully repaid in 2024-25.
Universal Transitional Kindergarten (TK)
For the 2024-25 school year, the Budget provides $1.5 billion ongoing Proposition 98 General Fund to shift the age eligibility for TK and provides an additional $516.7 million ongoing Proposition 98 General Fund to support adding additional certificated and classified staff to TK classrooms.
In the 2025-26 school year, the Budget provides a total of $2.4 billion ongoing Proposition 98 General Fund to support the full implementation of TK and serve all children who turn four years old by September 1st of the school year they enroll. The Budget also provides $1.5 billion ongoing Proposition 98 General Fund to support lowering the student to adult ratio from 12:1 to 10:1 in all TK classrooms.
Expanded Learning Opportunities Program
2025-26 is the final fiscal implementation year for the Expanded Learning Opportunities Program, moving to universal access for LEAs with 55% or more unduplicated pupils. The Budget includes $435 million in ongoing Proposition 98 General Fund, increasing the total ongoing program funding to $4.4 billion in Proposition 98 General Fund. This includes funding for LEAs with less than 55% unduplicated pupils so that all unduplicated pupils across the State can be served.
Student Support and Professional Development Discretionary Block Grant
The Budget includes $1.8 billion in one time Proposition 98 General Fund for a discretionary block grant. This will provide LEAs with funds to address rising costs and support statewide priorities such as the English Language Arts/English Language Development (ELA/ELD) Framework, professional development on the Mathematics Framework, and teacher recruitment and retention.
Master Plan for Career Education: TK-12 Education
The administration has been engaged in cross-agency collaborations to make it easier for Californians to receive college credits in high school and in recognition of their real-world experiences, leading to careers in high-demand fields.
To support this effort, dual enrollment and pathways programs are allowable uses of funds in the Student Support and Discretionary Block Grant and the Budget includes an increase of $3 million ongoing Proposition 98 for the California College Guidance Initiative and the Cradle-to-Career Data System.
Literacy Instruction
Over the past six years, California has invested in evidence-based literacy and professional learning to support the implementation of English Language Arts/English Language Development (ELA/ELD) framework. To support LEAs with instructional materials and to provide evidence-based literacy instruction, the Budget proposes the following:
- $500 million one-time Proposition 98 General Fund for TK-12 Literacy and Mathematics Coaches.
- $40 million in one-time Proposition 98 General Fund in 2025-26 to support necessary costs, including purchasing screening materials and training for educators, to administer literacy screenings.
- $5 million Proposition 98 General Fund annually through the 2029-30 fiscal year to launch a Literacy Network within the Statewide System of Support.
The Budget also directs the Instructional Quality Commission (IQC) to begin a follow-up adoption of ELA/ELD instructional materials. The Budget also includes $300,000 in one-time non-Prop 98 General Fund in 2024-25 for the IQC to develop a curriculum guide and resource.
In addition to these dedicated resources, the Student Support and Professional Development Block Grant discussed above, can fund professional development on this work.
Teacher Preparation and Professional Development
The administration recognizes the challenge of staff shortages and is dedicated to recruiting a diverse and qualified workforce of administrators, teachers, and classified staff. The Budget includes investments to support teachers and improve access to educator pipeline, including the following:
- $150 million one-time Prop 98 General Fund to provide financial assistance for teacher candidates through the new Teacher Recruitment Incentive Grant Program.
- $100 million one-time Prop 98 General Fund to extend the timeline of existing National Board Program to support National Board Certified teachers to teach and mentor other instructional staff in high poverty schools.
School Facility Program
Recently approved Proposition 2 authorized a total of $8.5 billion in state General Obligation bonds for K‑12 schools to be allocated through the School Facility Program. These funds are distributed across several major areas:
- $4 billion for modernization projects
- $3.3 billion for new construction
- $600 million for charter schools
- $600 million for career technical education projects
There has been no additional funding allocated for K-12 facilities.
Major K-12 Budget Adjustments
This section highlights the Budget’s significant adjustments to various educational programs outside of the LCFF.
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